ASSOCIATED BANC-CORP - FORM 8-K - EX-99.1 - EXHIBIT 99.1

Attached files

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EX-99.2 - EXHIBIT 99.2 - ASSOCIATED BANC-CORP	asb3q18earningspresentat.htm
8-K - FORM 8-K - ASSOCIATED BANC-CORP	asb09302018form8-kpressrel.htm

Exhibit 99.1



	NEWS RELEASE Investor Contact: Robb Timme, Vice President, Investor Relations 920-491-7059 Media Contact: Jennifer Kaminski, Vice President, Public Relations Senior Manager 920-491-7576

Associated Banc-Corp Reports Third Quarter Earnings of $0.48 Per Common Share, or $0.49 Per Common Share Excluding $3 million in Acquisition Related Costs¹

Earnings per share up 17% from the prior year

GREEN BAY, Wis. -- October 18, 2018 -- Associated Banc-Corp (NYSE: ASB) ("Associated" or "Company") today reported net income available to common equity ("earnings") of $84 million, or $0.48 per common share for the quarter ended September 30, 2018. This compares to net income available to common equity of $63 million, or $0.41 per common share for the quarter ended September 30, 2017.

“Associated's customer deposit franchise continues to be strong. Data recently released by the FDIC shows that we grew our deposits 14% in Illinois and maintained our #3 ranking in Wisconsin with nearly 11% market share. Additionally, during the third quarter we saw robust deposit inflows from our municipal customers which allowed us to further reduce our higher cost network deposits." said President and CEO Philip B. Flynn. "We are also pleased with our year over year EPS growth. Our commercial and business lending portfolios had solid results and we continued to benefit from a benign credit environment that allowed us to further reduce our provision for credit loss."

THIRD QUARTER 2018 SUMMARY (all comparisons to the third quarter of 2017)


•	Average loans of $23.0 billion were up 10%, or $2.1 billion


•	Average deposits of $24.7 billion were up 10%, or $2.3 billion


•	Net interest income of $219 million increased $29 million, or 15%


•	Net interest margin of 2.92% improved 8 basis points from 2.84%


•	Provision for credit losses was negative $5 million, down from $5 million


•	Noninterest income of $88 million was up $2 million, or 3%


•	Noninterest expense of $204 million was up $27 million and included $2 million of acquisition related expenses


•	Income before income taxes was up 16%, or $15 million


•	During the quarter, the Company repurchased approximately 4 million shares, or $118 million, of common stock


•	Total dividends paid per common share were $0.15, up 25%

¹This is a non-GAAP financial measure. Management believes these measures are meaningful because they reflect adjustments commonly made by management, investors, regulators, and analysts to evaluate the adequacy of earnings per common share, provide greater understanding of ongoing operations and enhance comparability of results with prior periods. See page 10 of the attached tables for a reconciliation of GAAP financial measures to non-GAAP financial measures which exclude acquisition related costs.

Loans

Third quarter 2018 average loans of $23.0 billion were up 10%, or $2.1 billion from the third quarter of 2017, and were essentially unchanged from the second quarter of 2018.

With respect to third quarter 2018 average balances by loan category:


•	Consumer lending increased $1.0 billion from the year ago quarter, and grew $12 million from the second quarter of 2018 to $9.6 billion.


•	Commercial and business lending increased $620 million from the year ago quarter and increased $242 million from the second quarter of 2018 to $7.9 billion. C&I loan growth was spread across all specialized lines of business and in the general commercial portfolio.


•	Commercial real estate lending increased $447 million from the third quarter of 2017, but decreased $285 million from the second quarter of 2018 to $5.4 billion.

Deposits

Third quarter 2018 average deposits of $24.7 billion were up $2.3 billion, or 10% from the year ago quarter, and were up $1.0 billion compared to the second quarter of 2018 due to seasonal inflows from municipal customers.

With respect to third quarter 2018 average balances by deposit category:


•	Interest-bearing demand deposits increased $995 million from the year ago quarter and increased $253 million from the second quarter of 2018 to $5.0 billion.


•	Money market deposits increased $929 million from the year ago quarter and increased $356 million from the second quarter of 2018 to $7.5 billion.


•	Time deposits increased $790 million from the year ago quarter and increased $413 million from the second quarter of 2018 to $3.0 billion.


•	Savings increased $356 million from the year ago quarter and increased $9 million from the second quarter of 2018 to $1.9 billion.


•	Noninterest-bearing demand deposits increased $319 million from the year ago quarter and increased $179 million from the second quarter of 2018 to $5.3 billion.


•	Network transaction deposits decreased $1.1 billion from the year ago quarter and decreased $161 million from the second quarter of 2018 to $2.0 billion.

Net Interest Income and Net Interest Margin

Third quarter 2018 net interest income of $219 million was up 15%, or $29 million, with the net interest margin increasing 8 basis points to 2.92% from the year ago quarter. Third quarter 2018 net interest income decreased 3%, or $7 million, with the net interest margin decreasing 10 basis points from the prior quarter.


•	The average yield on total commercial loans for the third quarter of 2018 increased 80 basis points to 4.73% from the year ago quarter, but decreased 2 basis points from the prior quarter.


•	The average cost of total interest-bearing deposits for the third quarter of 2018 increased 40 basis points to 1.03% from the year ago quarter and increased 20 basis points from the prior quarter.


•	The net free funds benefit, the benefit of holding noninterest-bearing demand deposits, increased 10 basis points in the third quarter of 2018 compared to the year ago quarter and increased 5 basis points from the prior quarter.

Noninterest Income

Third quarter 2018 total noninterest income of $88 million increased $2 million from the year ago quarter, but decreased $5 million from the prior quarter.

With respect to third quarter 2018 noninterest income line items:


•	Insurance commissions and fees were up $2 million from the year ago quarter, driven by the acquisitions of Diversified Insurance Solutions and Anderson Insurance, but were down $2 million from the prior quarter due to seasonal fluctuations of the employee benefits and property and casualty businesses.


•	Mortgage banking fees were down $3 million from the year ago quarter and down $2 million from the prior quarter due to lower sales and refinancing volumes in the underlying housing market.

Noninterest Expense

Third quarter 2018 total noninterest expense of $204 million increased 15%, or $27 million from the year ago quarter, but decreased $7 million from the prior quarter. Third quarter 2018 noninterest expense includes $2 million of Bank Mutual acquisition related costs.

With respect to third quarter 2018 noninterest expense line items:


•	Personnel expense increased $16 million from the year ago quarter, primarily driven by the additional cost of Bank Mutual staff. Personnel expense was essentially unchanged from the second quarter of 2018.


•	Technology expense increased $2 million from the year ago quarter, but decreased by $2 million from the prior quarter. The changes were largely driven by the additional cost of Bank Mutual operations.


•	Occupancy expense increased $2 million from the year ago quarter, with most of the increase coming from the additional expense of acquired Bank Mutual facilities. Occupancy expense was down slightly from the prior quarter.


•	Acquisition related costs decreased $5 million from the prior quarter.

Taxes

The third quarter 2018 effective tax rate was 21% compared to 31% in the year ago quarter. The decrease is primarily due to the Tax Cut and Jobs Act (TCJA) signed into law on December 22, 2017.

Credit

The third quarter provision for credit losses was negative $5 million, down from $5 million in the year ago quarter and down from $4 million in the prior quarter.

With respect to third quarter 2018 credit quality:


•	Potential problem loans of $236 million were down $22 million from the year ago quarter and were down $5 million from the prior quarter.


•	Nonaccrual loans of $154 million were down $56 million from the year ago quarter and were down $50 million from the prior quarter. The decrease was primarily driven by credit upgrades and payoffs. The nonaccrual loans to total loans ratio was 0.67% in the third quarter, compared to 1.01% in the year ago quarter, and 0.89% in the prior quarter.


•	Net charge offs of $12 million were up $2 million from the year ago quarter and were up $4 million from the prior quarter. Net oil and gas charge offs were $9 million in the third quarter.


•	The allowance for loan losses of $236 million was down $40 million from the year ago quarter and was down $16 million from the prior quarter. The allowance for loan losses to total loans ratio was 1.03% in the third quarter of 2018, compared to 1.32% in the year ago quarter, and 1.10% in the prior quarter.


•	The allowance related to the oil and gas portfolio was $10 million at September 30, 2018 and represented 1.4% of total oil and gas loans compared to 5.2% in the year ago quarter, and 2.5% in the prior quarter.

Capital

The Company’s capital position remains strong, with a CET1 capital ratio of 10.4% at September 30, 2018. The Company’s capital ratios continue to be in excess of the Basel III “well-capitalized” regulatory benchmarks on a fully phased in basis.

During the quarter, the Company repurchased approximately 4 million shares, or $118 million, of common stock, at an average price of $27.09 per share.

THIRD QUARTER 2018 EARNINGS RELEASE CONFERENCE CALL

The Company will host a conference call for investors and analysts at 4:00 p.m. Central Time (CT) today, October 18, 2018. Interested parties can access the live webcast of the call through the Investor Relations section of the Company's website, http://investor.associatedbank.com. Parties may also dial into the call at 877-407-8037 (domestic) or 201-689-8037 (international) and request the Associated Banc-Corp third quarter 2018 earnings call. The third quarter 2018 financial tables with an accompanying slide presentation will be available on the Company's website just prior to the call. An audio archive of the webcast will be available on the Company's website approximately fifteen minutes after the call is over.

ABOUT ASSOCIATED BANC-CORP

Associated Banc-Corp (NYSE: ASB) has total assets of $33 billion and is one of the top 50 publicly traded U.S. bank holding companies. Headquartered in Green Bay, Wisconsin, Associated is a leading Midwest banking franchise, offering a full range of financial products and services from more than 230 banking locations serving more than 110 communities throughout Wisconsin, Illinois and Minnesota, and commercial financial services in Indiana, Michigan, Missouri, Ohio and Texas. Associated Bank, N.A. is an Equal Housing Lender, Equal Opportunity Lender and Member FDIC. More information about Associated Banc-Corp is available at www.associatedbank.com.

FORWARD-LOOKING STATEMENTS

Statements made in this document which are not purely historical are forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. This includes any statements regarding management’s plans, objectives, or goals for future operations, products or services, and forecasts of its revenues, earnings, or other measures of performance. Such forward-looking statements may be identified by the use of words such as “believe,” “expect,” “anticipate,” “plan,” “estimate,” “should,” “will,” “intend,” "target," “outlook,” or similar expressions. Forward-looking statements are based on current management expectations and, by their nature, are subject to risks and uncertainties. Actual results may differ materially from those contained in the forward-looking statements. Factors which may cause actual results to differ materially from those contained in such forward-looking statements include those identified in the Company’s most recent Form 10-K and subsequent SEC filings. Such factors are incorporated herein by reference.

NON-GAAP FINANCIAL MEASURES

This press release and related materials may contain references to measures which are not defined in generally accepted accounting principles (“GAAP”). Information concerning these non-GAAP financial measures can be found in the financial tables. Management believes these measures are meaningful because they reflect adjustments commonly made by management, investors, regulators, and analysts to evaluate the adequacy of earnings per common share, provide a greater understanding of ongoing operations and enhance comparability of results with prior periods.

# # #



Associated Banc-Corp Consolidated Balance Sheets (Unaudited)
(In thousands)	Sep 30, 2018			Jun 30, 2018			Seql Qtr $ Change			Mar 31, 2018			Dec 31, 2017			Sep 30, 2017			Comp Qtr $ Change
Assets
Cash and due from banks	$	374,168		$	396,761		$	(22,593	)	$	328,260		$	483,666		$	354,331		$	19,837
Interest-bearing deposits in other financial institutions	147,848			71,462			76,386			94,918			199,702			109,596			38,252
Federal funds sold and securities purchased under agreements to resell	24,325			3,150			21,175			10,000			32,650			27,700			(3,375		)
Investment securities held to maturity, at amortized cost	2,661,755			2,602,247			59,508			2,443,203			2,282,853			2,233,579			428,176
Investment securities available for sale, at fair value	4,054,197			4,261,651			(207,454		)	4,485,875			4,043,446			3,801,699			252,498
Federal Home Loan Bank and Federal Reserve Bank stocks, at cost	220,825			249,040			(28,215		)	233,216			165,331			172,446			48,379
Residential loans held for sale	134,361			143,022			(8,661		)	103,953			85,544			113,064			21,297
Commercial loans held for sale	30,452			—			30,452			6,091			—			9,718			20,734
Loans	22,867,112			22,976,786			(109,674		)	22,810,491			20,784,991			20,931,460			1,935,652
Allowance for loan losses	(236,250		)	(252,601		)	16,351			(257,058		)	(265,880		)	(276,551		)	40,301
Loans, net	22,630,861			22,724,184			(93,323		)	22,553,433			20,519,111			20,654,909			1,975,952
Bank and corporate owned life insurance	661,009			659,592			1,417			657,841			591,057			589,093			71,916
Tax credit and other investments	132,355			137,051			(4,696		)	142,368			147,099			120,927			11,428
Trading assets	140,328			132,919			7,409			102,890			69,675			48,429			91,899
Premises and equipment	358,926			361,385			(2,459		)	381,327			330,963			330,065			28,861
Goodwill	1,168,922			1,166,665			2,257			1,153,156			976,239			972,006			196,916
Mortgage servicing rights, net	67,872			66,980			892			66,407			58,384			58,377			9,495
Other intangible assets, net	78,069			80,346			(2,277		)	79,714			15,580			14,080			63,989
Other assets	602,730			596,190			6,540			523,855			482,294			454,528			148,202
Total assets	$	33,489,002		$	33,652,647		$	(163,645	)	$	33,366,505		$	30,483,594		$	30,064,547		$	3,424,455
Liabilities and stockholders’ equity
Noninterest-bearing demand deposits	$	5,421,270		$	5,341,361		$	79,909		$	5,458,473		$	5,478,416		$	5,177,734		$	243,536
Interest-bearing deposits	19,410,342			18,474,953			935,389			18,367,129			17,307,546			17,155,717			2,254,625
Total deposits	24,831,612			23,816,314			1,015,298			23,825,602			22,785,962			22,333,451			2,498,161
Federal funds purchased and securities sold under agreements to repurchase	166,556			203,733			(37,177		)	283,954			324,815			476,550			(309,994		)
Commercial paper	43,604			52,791			(9,187		)	82,420			67,467			68,067			(24,463		)
FHLB advances	3,332,655			4,797,857			(1,465,202		)	4,515,887			3,184,168			3,170,172			162,483
Other long-term funding	795,215			497,619			297,596			497,451			497,282			497,113			298,102
Trading liabilities	138,940			131,612			7,328			100,247			67,660			46,812			92,128
Accrued expenses and other liabilities	383,381			382,476			905			348,246			318,797			268,781			114,600
Total liabilities	29,691,963			29,882,403			(190,440		)	29,653,806			27,246,151			26,860,946			2,831,017
Stockholders’ equity
Preferred equity	256,716			159,401			97,315			159,853			159,929			159,929			96,787
Common equity
Common stock	1,752			1,751			1			1,741			1,618			1,615			137
Surplus	1,834,017			1,828,965			5,052			1,823,800			1,454,188			1,442,328			391,689
Retained earnings	1,977,925			1,920,579			57,346			1,859,068			1,819,230			1,792,184			185,741
Accumulated other comprehensive income (loss)	(135,520		)	(119,888		)	(15,632		)	(107,673		)	(62,758		)	(54,288		)	(81,232		)
Treasury stock, at cost	(137,852		)	(20,564		)	(117,288		)	(24,089		)	(134,764		)	(138,167		)	315
Total common equity	3,540,322			3,610,843			(70,521		)	3,552,847			3,077,514			3,043,672			496,650
Total stockholders’ equity	3,797,038			3,770,244			26,794			3,712,699			3,237,443			3,203,601			593,437
Total liabilities and stockholders’ equity	$	33,489,002		$	33,652,647		$	(163,645	)	$	33,366,505		$	30,483,594		$	30,064,547		$	3,424,455

Numbers may not sum due to rounding.

Page 1



Associated Banc-Corp Consolidated Statements of Income (Unaudited)
(In thousands, except per share data)							Comp Qtr					YTD			YTD			Comp YTD
(In thousands, except per share data)	3Q18			3Q17			$ Change			% Change		Sep 2018			Sep 2017			$ Change			% Change
Interest income
Interest and fees on loans	$	249,649		$	196,972		$	52,677		27	%	$	716,329		$	554,867		$	161,462		29	%
Interest and dividends on investment securities
Taxable	29,895			24,162			5,733			24	%	90,622			71,295			19,327			27	%
Tax-exempt	11,883			8,268			3,615			44	%	31,883			24,540			7,343			30	%
Other interest	4,036			2,492			1,544			62	%	9,366			5,581			3,785			68	%
Total interest income	295,464			231,894			63,570			27	%	848,201			656,283			191,918			29	%
Interest expense
Interest on deposits	50,116			27,778			22,338			80	%	121,959			65,882			56,077			85	%
Interest on Federal funds purchased and securities sold under agreements to repurchase	504			768			(264		)	(34	)%	1,564			2,107			(543		)	(26	)%
Interest on other short-term funding	38			70			(32		)	(46	)%	150			239			(89		)	(37	)%
Interest on FHLB advances	19,318			8,612			10,706			124	%	53,720			20,209			33,511			166	%
Interest on long-term funding	6,095			4,544			1,551			34	%	15,183			13,632			1,551			11	%
Total interest expense	76,072			41,772			34,300			82	%	192,576			102,068			90,508			89	%
Net interest income	219,392			190,122			29,270			15	%	655,625			554,215			101,410			18	%
Provision for credit losses	(5,000		)	5,000			(10,000		)	(200	)%	(1,000		)	26,000			(27,000		)	(104	)%
Net interest income after provision for credit losses	224,392			185,122			39,270			21	%	656,625			528,215			128,410			24	%
Noninterest income
Insurance commissions and fees	21,636			19,815			1,821			9	%	68,279			62,288			5,991			10	%
Service charges and deposit account fees	16,904			16,268			636			4	%	49,714			48,654			1,060			2	%
Card-based and loan fees	14,090			12,619			1,471			12	%	41,899			38,848			3,051			8	%
Trust and asset management fees	14,140			12,785			1,355			11	%	40,946			37,066			3,880			10	%
Brokerage commissions and fees	7,084			4,392			2,692			61	%	21,253			13,071			8,182			63	%
Mortgage banking, net	4,012			6,585			(2,573		)	(39	)%	16,640			16,191			449			3	%
Capital markets, net	5,099			4,610			489			11	%	15,189			12,535			2,654			21	%
Bank and corporate owned life insurance	3,540			6,580			(3,040		)	(46	)%	10,705			13,094			(2,389		)	(18	)%
Asset gains (losses), net ⁽¹⁾	(1,037		)	(16		)	(1,021		)	N/M		1,353			(716		)	2,069			N/M
Investment securities gains (losses), net	30			3			27			N/M		(1,985		)	359			(2,344		)	N/M
Other	2,802			2,254			548			24	%	7,529			6,746			783			12	%
Total noninterest income	88,300			85,895			2,405			3	%	271,522			248,136			23,386			9	%
Noninterest expense
Personnel	124,476			108,098			16,378			15	%	366,141			321,946			44,195			14	%
Occupancy	14,519			12,294			2,225			18	%	44,947			40,345			4,602			11	%
Technology	17,563			15,233			2,330			15	%	54,730			45,126			9,604			21	%
Equipment	5,838			5,232			606			12	%	17,347			15,951			1,396			9	%
Business development and advertising	8,213			7,764			449			6	%	21,973			20,751			1,222			6	%
Legal and professional	5,476			6,248			(772		)	(12	)%	17,173			16,125			1,048			6	%
Card issuance and loan costs	3,677			3,330			347			10	%	10,154			8,924			1,230			14	%
Foreclosure / OREO expense, net	950			906			44			5	%	2,694			3,593			(899		)	(25	)%
FDIC assessment	7,750			7,800			(50		)	(1	)%	24,250			23,800			450			2	%
Other intangible amortization	2,233			450			1,783			N/M		5,926			1,459			4,467			N/M
Acquisition related costs ⁽²⁾	2,271			—			2,271			N/M		29,983			—			29,983			N/M
Other	11,445			10,072			1,373			14	%	33,318			29,413			3,905			13	%
Total noninterest expense	204,413			177,427			26,986			15	%	628,636			527,434			101,202			19	%
Income before income taxes	108,279			93,590			14,689			16	%	299,510			248,917			50,593			20	%
Income tax expense	22,349			28,589			(6,240		)	(22	)%	54,932			69,663			(14,731		)	(21	)%
Net income	85,929			65,001			20,928			32	%	244,578			179,254			65,324			36	%
Preferred stock dividends	2,409			2,339			70			3	%	7,077			7,008			69			1	%
Net income available to common equity	$	83,521		$	62,662		$	20,859		33	%	$	237,501		$	172,246		$	65,255		38	%
Earnings per common share
Basic	$	0.49		$	0.41		$	0.08		20	%	$	1.40		$	1.13		$	0.27		24	%
Diluted	$	0.48		$	0.41		$	0.07		17	%	$	1.38		$	1.11		$	0.27		24	%
Average common shares outstanding
Basic	170,516			150,565			19,951			13	%	168,249			150,983			17,266			11	%
Diluted	172,802			152,968			19,834			13	%	170,876			153,782			17,094			11	%

N/M = Not meaningful

Numbers may not sum due to rounding.


(1)	3Q18 includes approximately $1 million of Bank Mutual acquisition related asset losses net of asset gains; YTD Sep 2018 includes approximately $2 million of Bank Mutual acquisition related asset losses net of asset gains.


(2)	Includes Bank Mutual acquisition related costs only.

Page 2



Associated Banc-Corp Consolidated Statements of Income (Unaudited) - Quarterly Trend
(In thousands, except per share data)							Seql Qtr														Comp Qtr
(In thousands, except per share data)	3Q18			2Q18			$ Change			% Change		1Q18			4Q17			3Q17			$ Change			% Change
Interest income
Interest and fees on loans	$	249,649		$	246,646		$	3,003		1	%	$	220,034		$	194,133		$	196,972		$	52,677		27	%
Interest and dividends on investment securities
Taxable	29,895			30,623			(728		)	(2	)%	30,104			25,614			24,162			5,733			24	%
Tax-exempt	11,883			10,783			1,100			10	%	9,217			8,437			8,268			3,615			44	%
Other interest	4,036			3,153			883			28	%	2,177			2,138			2,492			1,544			62	%
Total interest income	295,464			291,205			4,259			1	%	261,532			230,322			231,894			63,570			27	%
Interest expense
Interest on deposits	50,116			38,431			11,685			30	%	33,412			28,143			27,778			22,338			80	%
Interest on Federal funds purchased and securities sold under agreements to repurchase	504			538			(34		)	(6	)%	522			420			768			(264		)	(34	)%
Interest on other short-term funding	38			51			(13		)	(25	)%	60			54			70			(32		)	(46	)%
Interest on FHLB advances	19,318			21,279			(1,961		)	(9	)%	13,123			10,156			8,612			10,706			124	%
Interest on long-term funding	6,095			4,544			1,551			34	%	4,544			4,544			4,544			1,551			34	%
Total interest expense	76,072			64,843			11,229			17	%	51,661			43,317			41,772			34,300			82	%
Net Interest income	219,392			226,362			(6,970		)	(3	)%	209,871			187,005			190,122			29,270			15	%
Provision for credit losses	(5,000		)	4,000			(9,000		)	N/M		—			—			5,000			(10,000		)	(200	)%
Net interest income after provision for credit losses	224,392			222,362			2,030			1	%	209,871			187,005			185,122			39,270			21	%
Noninterest income
Insurance commissions and fees	21,636			23,996			(2,360		)	(10	)%	22,648			19,186			19,815			1,821			9	%
Service charges and deposit account fees	16,904			16,390			514			3	%	16,420			15,773			16,268			636			4	%
Card-based and loan fees	14,090			14,387			(297		)	(2	)%	13,422			13,840			12,619			1,471			12	%
Trust and asset management fees	14,140			13,437			703			5	%	13,369			13,125			12,785			1,355			11	%
Brokerage commissions and fees	7,084			6,896			188			3	%	7,273			6,864			4,392			2,692			61	%
Mortgage banking, net	4,012			6,258			(2,246		)	(36	)%	6,370			3,169			6,585			(2,573		)	(39	)%
Capital markets, net	5,099			4,783			316			7	%	5,306			7,107			4,610			489			11	%
Bank and corporate owned life insurance	3,540			3,978			(438		)	(11	)%	3,187			3,156			6,580			(3,040		)	(46	)%
Asset gains (losses), net ⁽¹⁾	(1,037		)	2,497			(3,534		)	(142	)%	(107		)	(528		)	(16		)	(1,021		)	N/M
Investment securities gains (losses), net	30			(2,015		)	2,045			(101	)%	—			75			3			27			N/M
Other	2,802			2,235			567			25	%	2,492			2,777			2,254			548			24	%
Total noninterest income	88,300			92,842			(4,542		)	(5	)%	90,380			84,544			85,895			2,405			3	%
Noninterest expense
Personnel	124,476			123,980			496			—	%	117,685			107,031			108,098			16,378			15	%
Occupancy	14,519			15,071			(552		)	(4	)%	15,357			13,497			12,294			2,225			18	%
Technology	17,563			19,452			(1,889		)	(10	)%	17,715			17,878			15,233			2,330			15	%
Equipment	5,838			5,953			(115		)	(2	)%	5,556			5,250			5,232			606			12	%
Business development and advertising	8,213			7,067			1,146			16	%	6,693			8,195			7,764			449			6	%
Legal and professional	5,476			6,284			(808		)	(13	)%	5,413			6,384			6,248			(772		)	(12	)%
Card issuance and loan costs	3,677			3,173			504			16	%	3,304			2,836			3,330			347			10	%
Foreclosure / OREO expense, net	950			1,021			(71		)	(7	)%	723			1,285			906			44			5	%
FDIC assessment	7,750			8,250			(500		)	(6	)%	8,250			7,500			7,800			(50		)	(1	)%
Other intangible amortization	2,233			2,168			65			3	%	1,525			500			450			1,783			N/M
Acquisition related costs ⁽²⁾	2,271			7,107			(4,836		)	(68	)%	20,605			—			—			2,271			N/M
Other	11,445			11,732			(287		)	(2	)%	10,140			11,343			10,072			1,373			14	%
Total noninterest expense	204,413			211,258			(6,845		)	(3	)%	212,965			181,699			177,427			26,986			15	%
Income before income taxes	108,279			103,947			4,332			4	%	87,285			89,850			93,590			14,689			16	%
Income tax expense	22,349			14,754			7,595			51	%	17,829			39,840			28,589			(6,240		)	(22	)%
Net income	85,929			89,192			(3,263		)	(4	)%	69,456			50,010			65,001			20,928			32	%
Preferred stock dividends	2,409			2,329			80			3	%	2,339			2,339			2,339			70			3	%
Net income available to common equity	$	83,521		$	86,863		$	(3,342	)	(4	)%	$	67,117		$	47,671		$	62,662		$	20,859		33	%
Earnings per common share
Basic	$	0.49		$	0.51		$	(0.02	)	(4	)%	$	0.41		$	0.31		$	0.41		$	0.08		20	%
Diluted	$	0.48		$	0.50		$	(0.02	)	(4	)%	$	0.40		$	0.31		$	0.41		$	0.07		17	%
Average common shares outstanding
Basic	170,516			170,633			(117		)	—	%	163,520			150,563			150,565			19,951			13	%
Diluted	172,802			173,409			(607		)	—	%	166,432			153,449			152,968			19,834			13	%

N/M = Not meaningful

Numbers may not sum due to rounding.


(1)	3Q18 includes approximately $1 million of Bank Mutual acquisition related asset losses net of asset gains; 2Q18 includes approximately $1 million of Bank Mutual acquisition related asset losses net of asset gains.


(2)	Includes Bank Mutual acquisition related costs only.

Page 3



Associated Banc-Corp Selected Quarterly Information
(In millions, except share and per share, full time equivalent employee and branch count data)	YTD Sep 2018			YTD Sep 2017			3Q18			2Q18			1Q18			4Q17			3Q17
Per common share data
Dividends	$	0.45		$	0.36		$	0.15		$	0.15		$	0.15		$	0.14		$	0.12
Market value:
High	28.85			26.50			28.35			28.85			26.90			26.10			25.70
Low	23.60			21.25			26.00			24.20			23.60			24.00			21.25
Close	26.00			24.25			26.00			27.30			24.85			25.40			24.25
Book value	20.91			19.98			20.91			20.81			20.63			20.13			19.98
Tangible book value / share	$	13.55		$	13.51		$	13.55		$	13.62		$	13.47		$	13.65		$	13.51
Performance ratios (annualized)
Return on average assets	0.99		%	0.82		%	1.02		%	1.07		%	0.88		%	0.66		%	0.86		%
Effective tax rate	18.34		%	27.99		%	20.64		%	14.19		%	20.43		%	44.34		%	30.55		%
Dividend payout ratio ⁽¹⁾	32.14		%	31.86		%	30.61		%	29.41		%	36.59		%	45.16		%	29.27		%
Net interest margin	2.95		%	2.83		%	2.92		%	3.02		%	2.92		%	2.79		%	2.84		%
Selected trend information
Average full time equivalent employees ⁽²⁾	4,712			4,308			4,707			4,792			4,637			4,303			4,324
Branch count							236			237			271			213			214
Assets under management, at market value ⁽³⁾							11,206			$	10,776		$	10,540		$	10,555		$	9,243
Mortgage loans originated for sale during period	$	848		$	466		$	331		$	319		$	198		$	249		$	246
Mortgage loan settlements during period	$	827		$	552		$	345		$	294		$	188		$	268		$	188
Mortgage portfolio serviced for others							$	8,547		$	8,501		$	8,507		$	7,647		$	7,653
Mortgage servicing rights, net / mortgage portfolio serviced for others							0.79		%	0.79		%	0.78		%	0.76		%	0.76		%
Shares outstanding, end of period							169,293			173,526			172,182			152,846			152,316
Net shares issuable to Associated Banc-Corp warrant ("ASBWS") holders ⁽⁴⁾							33			136			1,023			1,134			903
Selected quarterly ratios
Loans / deposits							92.09		%	96.47		%	95.74		%	91.22		%	93.72		%
Stockholders’ equity / assets							11.34		%	11.20		%	11.13		%	10.62		%	10.66		%
Risk-based capital ^{(5) (6)}
Total risk-weighted assets							$	23,907		$	24,059		$	23,535		$	21,544		$	21,657
Common equity Tier 1							$	2,475		$	2,528		$	2,474		$	2,172		$	2,144
Common equity Tier 1 capital ratio							10.35		%	10.51		%	10.51		%	10.08		%	9.90		%
Tier 1 capital ratio							11.42		%	11.17		%	11.19		%	10.82		%	10.64		%
Total capital ratio							13.56		%	13.36		%	13.45		%	13.22		%	13.04		%
Tier 1 leverage ratio							8.43		%	8.32		%	8.48		%	8.02		%	7.93		%
Loans
Recorded investment on loans							$	22,800		$	22,916		$	22,756		$	20,699		$	20,849
Net unaccreted Bank Mutual purchase discount							(21		)	(26		)	(34		)	—			—
Net other deferred costs							87			87			88			86			83
Loans							$	22,867		$	22,977		$	22,810		$	20,785		$	20,931

Numbers may not sum due to rounding.


(1)	Ratio is based upon basic earnings per common share.


(2)	Average full time equivalent employees without overtime.


(3)	Excludes assets held in brokerage accounts.


(4)	Based on the treasury stock method and the period-end close price. The ASBWS warrants will expire on November 21, 2018.


(5)	The Federal Reserve establishes regulatory capital requirements, including well-capitalized standards for the Corporation. The regulatory capital requirements effective for the Corporation follow Basel III, subject to certain transition provisions.


(6)	September 30, 2018 data is estimated.

Page 4



Associated Banc-Corp Selected Asset Quality Information
(In thousands)	Sep 30, 2018			Jun 30, 2018			Seql Qtr % Change		Mar 31, 2018			Dec 31, 2017			Sep 30, 2017			Comp Qtr % Change
Allowance for loan losses
Balance at beginning of period	$	252,601		$	257,058		(2	)%	$	265,880		$	276,551		$	281,101		(10	)%
Provision for loan losses	(4,000		)	4,000			(200	)%	500			—			6,000			(167	)%
Charge offs	(17,304		)	(14,926		)	16	%	(12,155		)	(14,289		)	(14,727		)	17	%
Recoveries	4,953			6,470			(23	)%	2,832			3,618			4,177			19	%
Net charge offs	(12,351		)	(8,456		)	46	%	(9,323		)	(10,671		)	(10,550		)	17	%
Balance at end of period	$	236,250		$	252,601		(6	)%	$	257,058		$	265,880		$	276,551		(15	)%
Allowance for unfunded commitments
Balance at beginning of period	$	26,336		$	26,336		—	%	$	24,400		$	24,400		$	25,400		4	%
Provision for unfunded commitments	(1,000		)	—			N/M		(500		)	—			(1,000		)	—	%
Amount recorded at acquisition	—			—			N/M		2,436			—			—			N/M
Balance at end of period	$	25,336		$	26,336		(4	)%	$	26,336		$	24,400		$	24,400		4	%
Allowance for credit losses	$	261,586		$	278,937		(6	)%	$	283,394		$	290,280		$	300,951		(13	)%
Provision for credit losses	$	(5,000	)	$	4,000		N/M		$	—		$	—		$	5,000		(200	)%
	Sep 30, 2018			Jun 30, 2018			Seql Qtr % Change		Mar 31, 2018			Dec 31, 2017			Sep 30, 2017			Comp Qtr % Change
Net charge offs
Commercial and industrial	$	(6,893	)	$	(6,606	)	4	%	$	(6,599	)	$	(8,212	)	$	(9,442	)	(27	)%
Commercial real estate—owner occupied	(252		)	270			(193	)%	(1,025		)	(246		)	13			N/M
Commercial and business lending	(7,145		)	(6,336		)	13	%	(7,624		)	(8,458		)	(9,429		)	(24	)%
Commercial real estate—investor	(3,958		)	(1,189		)	N/M		8			(164		)	55			N/M
Real estate construction	(195		)	48			N/M		189			(365		)	(150		)	30	%
Commercial real estate lending	(4,153		)	(1,141		)	N/M		197			(529		)	(95		)	N/M
Total commercial	(11,298		)	(7,477		)	51	%	(7,427		)	(8,987		)	(9,524		)	19	%
Residential mortgage	5			(135		)	(104	)%	(131		)	(966		)	(26		)	(119	)%
Home equity	200			140			43	%	(677		)	330			(87		)	N/M
Other consumer	(1,258		)	(984		)	28	%	(1,088		)	(1,048		)	(913		)	38	%
Total consumer	(1,053		)	(979		)	8	%	(1,896		)	(1,684		)	(1,026		)	3	%
Total net charge offs	$	(12,351	)	$	(8,456	)	46	%	$	(9,323	)	$	(10,671	)	$	(10,550	)	17	%

(In basis points)	Sep 30, 2018			Jun 30, 2018					Mar 31, 2018			Dec 31, 2017			Sep 30, 2017
Net charge offs to average loans (annualized)
Commercial and industrial	(39		)	(39		)			(41		)	(51		)	(58		)
Commercial real estate—owner occupied	(11		)	12					(48		)	(12		)	1
Commercial and business lending	(36		)	(33		)			(42		)	(47		)	(51		)
Commercial real estate—investor	(40		)	(12		)			—			(2		)	1
Real estate construction	(5		)	1					5			(10		)	(4		)
Commercial real estate lending	(30		)	(8		)			1			(4		)	(1		)
Total commercial	(34		)	(22		)			(24		)	(30		)	(31		)
Residential mortgage	—			(1		)			(1		)	(5		)	—
Home equity	9			6					(30		)	15			(4		)
Other consumer	(133		)	(105		)			(115		)	(109		)	(97		)
Total consumer	(4		)	(4		)			(8		)	(8		)	(5		)
Total net charge offs	(21		)	(15		)			(17		)	(20		)	(20		)

(In thousands)	Sep 30, 2018			Jun 30, 2018			Seql Qtr % Change		Mar 31, 2018			Dec 31, 2017			Sep 30, 2017			Comp Qtr % Change
Credit Quality
Nonaccrual loans	$	154,092		$	204,460		(25	)%	$	208,553		$	208,546		$	210,517		(27	)%
Other real estate owned (OREO)^(a)	25,653			27,207			(6	)%	16,919			12,608			8,483			N/M
Other nonperforming assets	6,379			7,059			(10	)%	7,117			7,418			7,418			(14	)%
Total nonperforming assets	$	186,124		$	238,726		(22	)%	$	232,589		$	228,572		$	226,418		(18	)%

Loans 90 or more days past due and still accruing	$	2,175		$	1,839		18	%	$	3,393		$	1,867		$	1,611		35	%
Allowance for loan losses to loans	1.03		%	1.10		%			1.13		%	1.28		%	1.32		%
Net unaccreted purchase discount to net purchased loans	1.48		%	1.58		%			1.80		%	—		%	—		%
Allowance for loan losses to nonaccrual loans	153.32		%	123.55		%			123.26		%	127.49		%	131.37		%
Nonaccrual loans to total loans	0.67		%	0.89		%			0.91		%	1.00		%	1.01		%
Nonperforming assets to total loans plus OREO	0.81		%	1.04		%			1.02		%	1.10		%	1.08		%
Nonperforming assets to total assets	0.56		%	0.71		%			0.70		%	0.75		%	0.75		%
Year-to-date net charge offs to average loans (annualized)	0.18		%	0.16		%			0.17		%	0.19		%	0.19		%


(a)	The March 31, 2018 to June 30, 2018 change in OREO is primarily due to the closure of Bank Mutual properties.

Page 5



Associated Banc-Corp Selected Asset Quality Information (continued)
(In thousands)	Sep 30, 2018		Jun 30, 2018		Seql Qtr % Change		Mar 31, 2018		Dec 31, 2017		Sep 30, 2017		Comp Qtr % Change
Nonaccrual loans
Commercial and industrial	$	50,146	$	81,776	(39	)%	$	102,667	$	112,786	$	122,284	(59	)%
Commercial real estate—owner occupied	4,779		18,649		(74	)%	20,636		22,740		15,598		(69	)%
Commercial and business lending	54,925		100,425		(45	)%	123,303		135,526		137,882		(60	)%
Commercial real estate—investor	19,725		26,503		(26	)%	15,574		4,729		3,543		N/M
Real estate construction	1,154		1,544		(25	)%	1,219		974		1,540		(25	)%
Commercial real estate lending	20,879		28,047		(26	)%	16,793		5,703		5,083		N/M
Total commercial	75,804		128,472		(41	)%	140,096		141,229		142,965		(47	)%
Residential mortgage	65,896		62,896		5	%	55,100		53,632		54,654		21	%
Home equity	12,324		12,958		(5	)%	13,218		13,514		12,639		(2	)%
Other consumer	68		134		(49	)%	139		171		259		(74	)%
Total consumer	78,288		75,988		3	%	68,456		67,317		67,552		16	%
Total nonaccrual loans	$	154,092	$	204,460	(25	)%	$	208,553	$	208,546	$	210,517	(27	)%

	Sep 30, 2018		Jun 30, 2018		Seql Qtr % Change		Mar 31, 2018		Dec 31, 2017		Sep 30, 2017		Comp Qtr % Change
Restructured loans (accruing)
Commercial and industrial	$	38,885	$	32,438	20	%	$	29,580	$	30,047	$	32,572	19	%
Commercial real estate—owner occupied	3,746		3,820		(2	)%	3,892		3,989		4,077		(8	)%
Commercial and business lending	42,631		36,258		18	%	33,472		34,036		36,649		16	%
Commercial real estate—investor	350		372		(6	)%	13,683		14,389		14,294		(98	)%
Real estate construction	218		222		(2	)%	305		310		316		(31	)%
Commercial real estate lending	568		594		(4	)%	13,988		14,699		14,610		(96	)%
Total commercial	43,199		36,852		17	%	47,460		48,735		51,259		(16	)%
Residential mortgage	16,986		17,934		(5	)%	19,902		17,068		16,859		1	%
Home equity	7,792		7,900		(1	)%	8,098		7,705		7,987		(2	)%
Other consumer	1,177		1,037		14	%	1,041		1,110		1,073		10	%
Total consumer	25,955		26,871		(3	)%	29,041		25,883		25,919		—	%
Total restructured loans (accruing)	$	69,154	$	63,723	9	%	$	76,501	$	74,618	$	77,178	(10	)%
Nonaccrual restructured loans (included in nonaccrual loans)	$	33,757	$	38,005	(11	)%	$	23,827	$	23,486	$	33,520	1	%
	Sep 30, 2018		Jun 30, 2018		Seql Qtr % Change		Mar 31, 2018		Dec 31, 2017		Sep 30, 2017		Comp Qtr % Change
Accruing Loans 30-89 Days Past Due
Commercial and industrial	$	5,732	$	588	N/M		$	880	$	271	$	1,378	N/M
Commercial real estate—owner occupied	6,126		193		N/M		511		48		1,522		N/M
Commercial and business lending	11,858		781		N/M		1,391		319		2,900		N/M
Commercial real estate—investor	373		828		(55	)%	240		374		1,109		(66	)%
Real estate construction	517		19,765		(97	)%	490		251		700		(26	)%
Commercial real estate lending	890		20,593		(96	)%	730		625		1,809		(51	)%
Total commercial	12,748		21,374		(40	)%	2,121		944		4,709		171	%
Residential mortgage	8,899		9,341		(5	)%	15,133		9,552		8,870		—	%
Home equity	8,080		7,270		11	%	5,868		6,825		7,191		12	%
Other consumer	1,979		1,735		14	%	1,811		2,007		1,686		17	%
Total consumer	18,958		18,346		3	%	22,812		18,384		17,747		7	%
Total accruing loans 30-89 days past due	$	31,706	$	39,720	(20	)%	$	24,934	$	19,328	$	22,456	41	%

	Sep 30, 2018		Jun 30, 2018		Seql Qtr % Change		Mar 31, 2018		Dec 31, 2017		Sep 30, 2017		Comp Qtr % Change
Potential Problem Loans
Commercial and industrial	$	144,468	$	172,177	(16	)%	$	196,766	$	113,778	$	153,779	(6	)%
Commercial real estate—owner occupied	32,526		38,879		(16	)%	34,410		41,997		57,468		(43	)%
Commercial and business lending	176,994		211,056		(16	)%	231,176		155,775		211,247		(16	)%
Commercial real estate—investor	49,842		24,790		101	%	46,970		19,291		46,770		7	%
Real estate construction	3,392		3,168		7	%	1,695		—		118		N/M
Commercial real estate lending	53,234		27,958		90	%	48,665		19,291		46,888		14	%
Total commercial	230,228		239,014		(4	)%	279,841		175,066		258,135		(11	)%
Residential mortgage	6,073		2,355		158	%	2,155		1,616		650		N/M
Home equity	148		142		4	%	188		195		124		19	%
Other consumer	—		6		(100	)%	—		—		—		N/M
Total consumer	6,221		2,503		149	%	2,343		1,811		774		N/M
Total potential problem loans	$	236,449	$	241,517	(2	)%	$	282,184	$	176,877	$	258,909	(9	)%

N/M = Not meaningful

Numbers may not sum due to rounding.

Page 6



Associated Banc-Corp Net Interest Income Analysis - Fully Tax-Equivalent Basis - Sequential and Comparable Quarter
	Three Months Ended
	September 30, 2018						June 30, 2018						September 30, 2017
(In thousands)	Average Balance		Interest Income /Expense		Average Yield /Rate		Average Balance		Interest Income /Expense		Average Yield /Rate		Average Balance		Interest Income /Expense		Average Yield /Rate
Assets
Earning assets
Loans^{(1) (2) (3)}
Commercial and business lending	$	7,938,739	$	91,250	4.56	%	$	7,697,057	$	86,771	4.52	%	$	7,318,594	$	71,169	3.86	%
Commercial real estate lending	5,420,680		68,020		4.98	%	5,705,817		72,049		5.06	%	4,973,436		50,396		4.02	%
Total commercial	13,359,419		159,270		4.73	%	13,402,874		158,820		4.75	%	12,292,030		121,565		3.93	%
Residential mortgage ⁽⁴⁾	8,333,303		71,926		3.45	%	8,310,358		69,774		3.36	%	7,339,827		59,828		3.26	%
Retail ⁽⁴⁾	1,280,996		18,859		5.87	%	1,292,196		18,466		5.72	%	1,267,280		16,541		5.21	%
Total loans	22,973,717		250,055		4.33	%	23,005,428		247,060		4.30	%	20,899,137		197,934		3.77	%
Investment securities
Taxable	5,290,859		29,895		2.26	%	5,518,077		30,623		2.22	%	4,846,653		24,162		1.99	%
Tax-exempt ⁽¹⁾	1,627,715		14,973		3.68	%	1,497,192		13,587		3.63	%	1,177,962		12,650		4.30	%
Other short-term investments	582,578		4,036		2.75	%	392,009		3,153		3.22	%	536,043		2,492		1.85	%
Investments and other	7,501,152		48,905		2.61	%	7,407,277		47,363		2.56	%	6,560,658		39,304		2.40	%
Total earning assets	30,474,870		$	298,959	3.91	%	30,412,705		$	294,423	3.88	%	27,459,795		$	237,238	3.44	%
Other assets, net	3,059,317						3,022,659						2,504,232
Total assets	$	33,534,187					$	33,435,364					$	29,964,027
Liabilities and stockholders' equity
Interest-bearing liabilities
Interest-bearing deposits
Savings	$	1,901,960	$	327	0.07	%	$	1,892,808	$	210	0.04	%	$	1,545,884	$	218	0.06	%
Interest-bearing demand	4,988,694		13,169		1.05	%	4,735,514		9,918		0.84	%	3,993,275		5,778		0.57	%
Money market	7,546,059		16,212		0.85	%	7,190,178		12,045		0.67	%	6,617,185		7,017		0.42	%
Network transaction deposits	1,969,915		10,027		2.02	%	2,130,854		9,503		1.79	%	3,104,997		9,392		1.20	%
Time deposits	2,978,314		10,382		1.38	%	2,565,001		6,755		1.06	%	2,187,986		5,372		0.97	%
Total interest-bearing deposits	19,384,942		50,116		1.03	%	18,514,355		38,431		0.83	%	17,449,327		27,778		0.63	%
Federal funds purchased and securities sold under agreements to repurchase	231,308		504		0.86	%	259,713		538		0.83	%	398,200		768		0.76	%
Commercial paper	43,911		38		0.35	%	65,631		51		0.31	%	86,689		70		0.32	%
FHLB advances	3,690,687		19,318		2.08	%	4,809,071		21,279		1.77	%	3,072,108		8,612		1.11	%
Long-term funding	656,055		6,095		3.72	%	497,517		4,544		3.65	%	497,014		4,544		3.66	%
Total short and long-term funding	4,621,961		25,956		2.23	%	5,631,932		26,412		1.88	%	4,054,011		13,994		1.37	%
Total interest-bearing liabilities	24,006,903		$	76,072	1.26	%	24,146,287		$	64,843	1.08	%	21,503,338		$	41,772	0.77	%
Noninterest-bearing demand deposits	5,310,977						5,131,894						4,992,118
Other liabilities	454,767						436,130						283,724
Stockholders’ equity	3,761,541						3,721,053						3,184,847
Total liabilities and stockholders’ equity	$	33,534,187					$	33,435,364					$	29,964,027
Interest rate spread					2.65	%					2.80	%					2.67	%
Net free funds					0.27	%					0.22	%					0.17	%
Fully tax-equivalent net interest income and net interest margin ("NIM")			$	222,887	2.92	%			$	229,580	3.02	%			$	195,466	2.84	%
Fully tax-equivalent adjustment			3,496						3,217						5,344
Net interest income			$	219,392					$	226,362					$	190,122

Numbers may not sum due to rounding.


(1)	Beginning in 2018, the yield on tax-exempt loans and securities is computed on a fully tax-equivalent basis using a tax rate of 21% and is net of the effects of certain disallowed interest deductions. Prior to 2018, the yield on tax-exempt loans and securities was computed on a fully tax-equivalent basis using a tax rate of 35% and was net of the effects of certain disallowed interest deductions.


(2)	Nonaccrual loans and loans held for sale have been included in the average balances.


(3)	Interest income includes amortization of net deferred loan origination costs and net accreted purchase loan discount.


(4)	Upon conversion, certain Bank Mutual loans were reclassified from home equity to residential mortgage. All prior periods have been adjusted to reflect this change.

Page 7



Associated Banc-Corp Net Interest Income Analysis - Fully Tax-Equivalent Basis - Year Over Year
	Nine months ended September 30,
	2018						2017
(In thousands)	Average Balance		Interest Income /Expense		Average Yield / Rate		Average Balance		Interest Income /Expense		Average Yield / Rate
Assets
Earning assets
Loans^{(1) (2) (3)}
Commercial and business lending	$	7,652,096	$	252,727	4.42	%	$	7,280,302	$	197,356	3.62	%
Commercial real estate lending	5,508,720		201,573		4.89	%	4,979,132		143,093		3.84	%
Total commercial	13,160,815		454,300		4.61	%	12,259,434		340,449		3.71	%
Residential mortgage ⁽⁴⁾	8,259,305		208,656		3.37	%	6,956,937		169,231		3.24	%
Retail ⁽⁴⁾	1,269,050		54,623		5.74	%	1,284,607		48,039		4.99	%
Total loans	22,689,170		717,579		4.22	%	20,500,978		557,719		3.63	%
Investment securities
Taxable	5,460,873		90,622		2.21	%	4,819,580		71,295		1.97	%
Tax-exempt⁽¹⁾	1,480,426		40,173		3.62	%	1,153,382		37,546		4.34	%
Other short-term investments	430,468		9,366		2.91	%	378,052		5,581		1.97	%
Investments and other	7,371,767		140,161		2.54	%	6,351,014		114,422		2.40	%
Total earning assets	30,060,938		$	857,740	3.81	%	26,851,992		$	672,141	3.34	%
Other assets, net	2,989,470						2,466,764
Total assets	$	33,050,408					$	29,318,756
Liabilities and stockholders' equity
Interest-bearing liabilities
Interest-bearing deposits
Savings	$	1,839,801	$	739	0.05	%	$	1,517,901	$	607	0.05	%
Interest-bearing demand	4,744,503		30,904		0.87	%	3,880,379		13,779		0.47	%
Money market	7,318,400		38,042		0.69	%	6,254,725		15,765		0.34	%
Network transaction deposits	2,168,209		28,308		1.75	%	3,357,125		23,510		0.94	%
Time deposits	2,753,832		23,966		1.16	%	1,853,295		12,221		0.88	%
Total interest-bearing deposits	18,824,746		121,959		0.87	%	16,863,427		65,882		0.52	%
Federal funds purchased and securities sold under agreements to repurchase	255,371		1,564		0.82	%	460,672		2,107		0.61	%
Commercial paper	60,979		150		0.33	%	100,178		239		0.32	%
FHLB advances	4,078,588		53,720		1.76	%	3,028,957		20,209		0.89	%
Long-term funding	550,888		15,183		3.67	%	496,842		13,632		3.66	%
Total short and long-term funding	4,945,826		70,617		1.91	%	4,086,650		36,186		1.18	%
Total interest-bearing liabilities	23,770,572		$	192,576	1.08	%	20,950,077		$	102,068	0.65	%
Noninterest-bearing demand deposits	5,176,858						4,950,252
Other liabilities	428,854						260,409
Stockholders’ equity	3,674,125						3,158,018
Total liabilities and stockholders’ equity	$	33,050,408					$	29,318,756
Interest rate spread					2.73	%					2.69	%
Net free funds					0.22	%					0.14	%
Fully tax-equivalent net interest income and net interest margin			$	665,164	2.95	%			$	570,073	2.83	%
Fully tax-equivalent adjustment			9,539						15,858
Net interest income			$	655,625					$	554,215

Numbers may not sum due to rounding.


(1)	Beginning in 2018, the yield on tax-exempt loans and securities is computed on a fully tax-equivalent basis using a tax rate of 21% and is net of the effects of certain disallowed interest deductions. Prior to 2018, the yield on tax-exempt loans and securities was computed on a fully tax-equivalent basis using a tax rate of 35% and was net of the effects of certain disallowed interest deductions.


(2)	Nonaccrual loans and loans held for sale have been included in the average balances.


(3)	Interest income includes amortization of net deferred loan origination costs and net accreted purchase loan discount.

(4) Upon conversion, certain Bank Mutual loans were reclassified from home equity to residential mortgage. All prior periods have been adjusted to reflect this change.

Page 8



Associated Banc-Corp Loan and Deposit Composition
(In thousands)
Period end loan composition ⁽³⁾	Sep 30, 2018		Jun 30, 2018		Seql Qtr % Change		Mar 31, 2018		Dec 31, 2017		Sep 30, 2017		Comp Qtr % Change
Commercial and industrial	$	7,159,941	$	7,109,796	1	%	$	6,756,983	$	6,399,693	$	6,534,660	10	%
Commercial real estate—owner occupied	867,682		888,330		(2	)%	900,913		802,209		827,064		5	%
Commercial and business lending	8,027,622		7,998,126		—	%	7,657,896		7,201,902		7,361,724		9	%
Commercial real estate—investor	3,924,499		3,996,415		(2	)%	4,077,671		3,315,254		3,345,536		17	%
Real estate construction	1,416,209		1,487,159		(5	)%	1,579,778		1,451,684		1,552,135		(9	)%
Commercial real estate lending	5,340,708		5,483,574		(3	)%	5,657,449		4,766,938		4,897,671		9	%
Total commercial	13,368,330		13,481,700		(1	)%	13,315,345		11,968,840		12,259,395		9	%
Residential mortgage	8,227,649		8,207,253		—	%	8,197,223		7,546,534		7,408,471		11	%
Home equity	901,275		911,363		(1	)%	923,470		883,804		890,130		1	%
Other consumer	369,858		376,470		(2	)%	374,453		385,813		373,464		(1	)%
Total consumer	9,498,782		9,495,086		—	%	9,495,146		8,816,151		8,672,065		10	%
Total loans	$	22,867,112	$	22,976,786	—	%	$	22,810,491	$	20,784,991	$	20,931,460	9	%
Purchased credit-impaired loans	$	13,133	$	15,900	(17	)%	$	14,838	$	—	$	—	N/M
Period end deposit and customer funding composition ⁽⁴⁾	Sep 30, 2018		Jun 30, 2018		Seql Qtr % Change		Mar 31, 2018		Dec 31, 2017		Sep 30, 2017		Comp Qtr % Change
Noninterest-bearing demand	$	5,421,270	$	5,341,361	1	%	$	5,458,473	$	5,478,416	$	5,177,734	5	%
Savings	1,937,006		1,887,777		3	%	1,883,638		1,524,992		1,544,037		25	%
Interest-bearing demand	5,096,998		4,650,407		10	%	4,719,566		4,603,157		4,990,891		2	%
Money market	9,087,587		9,208,993		(1	)%	9,086,553		8,830,328		8,299,512		9	%
Brokered CDs	235,711		228,029		3	%	44,503		18,609		3,554		N/M
Other time	3,053,041		2,499,747		22	%	2,632,869		2,330,460		2,317,723		32	%
Total deposits	24,831,612		23,816,314		4	%	23,825,602		22,785,962		22,333,451		11	%
Customer funding ⁽¹⁾	184,269		235,804		(22	)%	297,289		250,332		324,042		(43	)%
Total deposits and customer funding	$	25,015,882	$	24,052,118	4	%	$	24,122,891	$	23,036,294	$	22,657,493	10	%
Network transaction deposits ⁽²⁾	$	1,852,863	$	2,094,670	(12	)%	$	2,244,739	$	2,520,968	$	2,622,787	(29	)%
Net deposits and customer funding (Total deposits and customer funding, excluding Brokered CDs and network transaction deposits)	$	22,927,308	$	21,729,419	6	%	$	21,833,649	$	20,496,717	$	20,031,152	14	%

Quarter average loan composition⁽³⁾	Sep 30, 2018		Jun 30, 2018		Seql Qtr % Change		Mar 31, 2018		Dec 31, 2017		Sep 30, 2017		Comp Qtr % Change
Commercial and industrial	$	7,059,946	$	6,804,311	4	%	$	6,449,898	$	6,366,626	$	6,487,378	9	%
Commercial real estate—owner occupied	878,793		892,746		(2	)%	863,723		811,758		831,216		6	%
Commercial and business lending	7,938,739		7,697,057		3	%	7,313,621		7,178,384		7,318,594		8	%
Commercial real estate—investor	3,948,922		4,117,675		(4	)%	3,866,286		3,369,785		3,346,669		18	%
Real estate construction	1,471,758		1,588,141		(7	)%	1,533,143		1,504,104		1,626,767		(10	)%
Commercial real estate lending	5,420,680		5,705,817		(5	)%	5,399,429		4,873,889		4,973,436		9	%
Total commercial	13,359,419		13,402,874		—	%	12,713,050		12,052,273		12,292,030		9	%
Residential mortgage⁽⁵⁾	8,333,303		8,310,358		—	%	8,066,297		7,546,288		7,339,827		14	%
Home equity⁽⁵⁾	906,364		917,688		(1	)%	917,001		885,235		894,596		1	%
Other consumer	374,632		374,508		—	%	382,180		379,820		372,684		1	%
Total consumer	9,614,298		9,602,555		—	%	9,365,479		8,811,343		8,607,107		12	%
Total loans	$	22,973,717	$	23,005,428	—	%	$	22,078,529	$	20,863,616	$	20,899,137	10	%

Quarter average deposit composition⁽⁴⁾	Sep 30, 2018		Jun 30, 2018		Seql Qtr % Change		Mar 31, 2018		Dec 31, 2017		Sep 30, 2017		Comp Qtr % Change
Noninterest-bearing demand	$	5,310,977	$	5,131,894	3	%	$	5,084,957	$	5,133,977	$	4,992,118	6	%
Savings	1,901,960		1,892,808		—	%	1,722,665		1,554,639		1,545,884		23	%
Interest-bearing demand	4,988,694		4,735,514		5	%	4,503,974		4,168,550		3,993,275		25	%
Money market	7,546,059		7,190,178		5	%	7,215,329		6,520,052		6,617,185		14	%
Network transaction deposits	1,969,915		2,130,854		(8	)%	2,408,681		2,517,737		3,104,997		(37	)%
Time deposits	2,978,314		2,565,001		16	%	2,715,292		2,354,828		2,187,986		36	%
Total deposits	$	24,695,918	$	23,646,250	4	%	$	23,650,898	$	22,249,783	$	22,441,445	10	%

N/M = Not meaningful

Numbers may not sum due to rounding.


(1)	Includes repurchase agreements and commercial paper.

(2) Included above in interest-bearing demand and money market.

(3) On February 1, 2018, the Corporation acquired Bank Mutual and added $1.9 billion of loans.

(4) On February 1, 2018, the Corporation acquired Bank Mutual and assumed $1.8 billion of deposits.

(5) Upon conversion, certain Bank Mutual loans were reclassified from home equity to residential mortgage. All prior periods have been adjusted to reflect this change.

Page 9



Associated Banc-Corp Non-GAAP Financial Measures Reconciliation
(In millions, except per share data)			YTD Sep 2018			YTD Sep 2017			3Q18			2Q18			1Q18			4Q17			3Q17
Tangible common equity reconciliation ⁽¹⁾
Common equity									$	3,540		$	3,611		$	3,553		$	3,078		$	3,044
Goodwill and other intangible assets, net									(1,247		)	(1,247		)	(1,233		)	(992		)	(986		)
Tangible common equity									$	2,293		$	2,364		$	2,320		$	2,086		$	2,058
Tangible assets reconciliation ⁽¹⁾
Total assets									$	33,489		$	33,653		$	33,367		$	30,484		$	30,065
Goodwill and other intangible assets, net									(1,247		)	(1,247		)	(1,233		)	(992		)	(986		)
Tangible assets									$	32,242		$	32,406		$	32,134		$	29,492		$	29,079
Average tangible common equity and average common equity tier 1 reconciliation⁽¹⁾
Common equity			$	3,510		$	2,998		$	3,589		$	3,561		$	3,377		$	3,056		$	3,025
Goodwill and other intangible assets, net			(1,197		)	(987		)	(1,246		)	(1,236		)	(1,108		)	(992		)	(986		)
Tangible common equity			2,313			2,011			2,343			2,325			2,269			2,064			2,039
Accumulated other comprehensive loss (income)			111			51			125			117			89			62			49
Deferred tax assets (liabilities), net			40			32			45			47			32			29			32
Average common equity Tier 1			$	2,464		$	2,094		$	2,513		$	2,489		$	2,390		$	2,155		$	2,120
Selected Trend Information ⁽²⁾
Insurance commissions and fees									$	22		$	24		$	23		$	19		$	20
Service charges and deposit account fees									17			16			16			16			16
Card-based and loan fees									14			14			13			14			13
Trust and asset management fees									14			13			13			13			13
Brokerage commissions and fees									7			7			7			7			4
Fee-based revenue									74			75			73			69			66
Other									14			18			17			16			20
Total noninterest income									$	88		$	93		$	90		$	85		$	86
Selected equity and performance ratios ^{(1) (3)}
Tangible common equity / tangible assets									7.11		%	7.29		%	7.22		%	7.07		%	7.08		%
Return on average equity			8.90		%	7.59		%	9.06		%	9.61		%	7.96		%	6.17		%	8.10		%
Return on average tangible common equity			13.73		%	11.45		%	14.14		%	14.98		%	11.99		%	9.16		%	12.20		%
Return on average common equity Tier 1			12.89		%	11.00		%	13.18		%	14.00		%	11.39		%	8.77		%	11.73		%
Efficiency ratio reconciliation ⁽⁴⁾
Federal Reserve efficiency ratio			67.50		%	65.64		%	66.12		%	65.77		%	70.76		%	66.93		%	63.92		%
Fully tax-equivalent adjustment			(0.69		)%	(1.27		)%	(0.75		)%	(0.65		)%	(0.66		)%	(1.30		)%	(1.21		)%
Other intangible amortization			(0.64		)%	(0.18		)%	(0.73		)%	(0.68		)%	(0.51		)%	(0.18		)%	(0.16		)%
Fully tax-equivalent efficiency ratio			66.18		%	64.19		%	64.66		%	64.45		%	69.60		%	65.45		%	62.55		%
Acquisition related costs adjustment			(3.33		)%	—		%	(0.94		)%	(2.40		)%	(6.60		)%	—		%	—		%
Fully tax-equivalent efficiency ratio, excluding acquisition related costs			62.85		%	64.19		%	63.72		%	62.05		%	63.00		%	65.45		%	62.55		%
Acquisition Related Costs	YTD 2018		YTD 2018 per share data⁽⁶⁾			3Q 2018			3Q 2018 per share data⁽⁶⁾			2Q 2018			2Q 2018 per share data⁽⁶⁾			1Q 2018			1Q 2018 per share data⁽⁶⁾
GAAP earnings	$	238	$	1.38		$	84		$	0.48		$	87		$	0.50		$	67		$	0.40
Change of control and severance	7					1						(1		)				7
Merger advisors and consultants	5					1						—						4
Facilities and other	8					1						2						5
Contract terminations and conversion costs	11					—						6						5
Asset losses (gains), net	$	2				$	1					$	1					$	—
Total acquisition related costs	$	32				$	3					$	8					$	21
Less additional tax expense	$	8				$	1					$	2					$	5
Earnings, excluding acquisition related costs ⁽⁵⁾	$	262	$	1.52		$	87		$	0.49		$	93		$	0.53		$	83		$	0.50

Numbers may not sum due to rounding.


(1)	The ratio tangible common equity to tangible assets excludes goodwill and other intangible assets, net. This financial measure has been included as it is considered to be a critical metric with which to analyze and evaluate financial condition and capital strength.


(2)	These financial measures have been included as they provide meaningful supplemental information to assess trends in the Corporation’s results of operations.


(3)	These capital measurements are used by management, regulators, investors, and analysts to assess, monitor and compare the quality and composition of our capital with the capital of other financial services companies.

(4)

The efficiency ratio as defined by the Federal Reserve guidance is noninterest expense (which includes the provision for unfunded commitments) divided by the sum of net interest income plus noninterest income, excluding investment securities gains / losses, net. The fully tax-equivalent efficiency ratio is noninterest expense (which includes the provision for unfunded commitments), excluding other intangible amortization, divided by the sum of fully tax-equivalent net interest income plus noninterest income, excluding investment securities gains / losses, net. Management believes the fully tax-equivalent efficiency ratio, which adjusts net interest income for the tax-favored status of certain loans and investment securities, to be the preferred industry measurement as it enhances the comparability of net interest income arising from taxable and tax-exempt sources.


(5)	This is a non-GAAP financial measure. Management believes these measures are meaningful because they reflect adjustments commonly made by management, investors, regulators, and analysts to evaluate the adequacy of earnings per common share and provide greater understanding of ongoing operations and enhanced comparability of results with prior periods.


(6)	Earnings and per share data presented after-tax.

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